Advance Auto Parts Earnings Preview

Advance Auto Parts (NYSE:
AAP
The Company
Performance
The company has a long-term earnings per share growth forecast of 11.7% and a return of equity of 34.6%. Its forward P/E ratio estimate is less than the trailing P/E ratio of 12.2, and its PEG ratio is 1.0. The dividend yield is 0.5%. But only six of 21 analysts rate the stock a Buy or Strong Buy. The share price is nearly 6% lower than a year ago. In the past six months, the stock has outperformed competitor Pep Boys (NYSE:
PBY
) but underperformed AutoZone (NYSE:
AZO
) and O'Reilly Automotive (NASDAQ:
ORLY
). The stock has also underperformed the broader markets in that time.
Action Items:Bullish:
Traders interested in an exchange traded fund that includes Advance Auto Parts as a top holding might want to consider the following trade:
  • SPDR S&P Retail ETF (NYSE: XRT): up nearly 8% since the beginning of the year
Bearish:
Traders who might prefer exchange traded funds that include Advance Auto Parts competitors as top holdings may want to consider these positions:
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